Once you understand the potential technology can bring, setting up the appropriate governance structure is the next step.
Setting up the appropriate governance structure is the next step.
Originally, the board and its members focused mainly on strategic management and organizational control. However, due to the increasing strategic role of technology and IT within an organization, it is only natural that boards should extend their governance and place technology at the top of their agenda. Research demonstrates that board-level engagement in IT leads to a better alignment of strategy and investments in technology as well as a higher appreciation in the market. Companies that report openly on their current IT status are deemed more attractive to investors.
The main hurdle that board members face through this evolution is an insufficient understanding of emerging technologies, the value they can create and the risks they bring with them. The boardroom needs to be aware of technological innovations and their potential to be able to understand their purpose and to critically examine the role technology can play.
A first step in this evolution is understanding the role of technology in your organization and your market. Our IT governance quick scan allows you to easily understand your current dependence on technology and the strategic advantage the right technology can bring you compared to the competition. This self-assessment will tell you whether your organization sits in factory mode, support mode, turnaround mode or strategic mode. Every position brings different questions you should be asking and different aspects you should be focusing on.
The second step is determining the right governance structure depending on the mode your organization currently sits in. If technology isn’t a main factor in differentiating you from your competitors on a strategic level, IT governance can be managed through an existing Audit/Risk Committee. If, on the other hand, investing in new technology can help you gain new or expand your current market share and set yourself apart from the competition, it might be wise to set up a dedicated IT Oversight Committee. In any case, regular and clear communication between the board and these committees is vital. Our team of experts can help you define the appropriate governance structure for your organization and help you take the necessary steps.
To ensure a smooth and effective process, your board members must harness sufficient technological insight. There are two ways to achieve this: appointing experienced IT professionals to the board or improving the IT skills of current board members. The latter approach can help board members ask the necessary critical questions when conferring with the newly appointed IT governance committees. Together with AMS, KPMG offers interactive workshops to help you better your team's knowledge of emerging technologies. Click here to read more on this training and see below the steps your organization can start taking now.